Satsumasendai City and Sumitomo Corporation have agreed to carry out a joint project on the Koshiki Islands to establish an effective use of reused batteries from electric vehicles (“EV”) as large-scale power storage facilities and to promote renewable energy into the micro-grid of these remote islands. The two parties reached this agreement on October 10th, 2014.

For small-scale electric power grids on remote islands, an introduction of intermittent weather-dependent renewable energy systems on a large scale will damage the balance of electric power supply and demand, and at times even cause power outages. Therefore, renewable energy systems need to be widely extended to remote islands which will entail the installation of power storage systems and other measures.
In this EV battery systems project, Satsumasendai City and Sumitomo will implement and validate a “local government model project” that will establish a low-cost business model utilizing economically-efficient reused EV battery systems which are set up through local government initiatives that puts in place the access infrastructure to tap into renewable energy. By proving the project’s economic viability, this model will promote to enforce the access capability for introducing renewable energy on a sustainable basis.

Satsumasendai City expects to obtain technical support and advice from Kyushu Electric Power Co., Inc., for the aim of making this a project that can be applied to other remote islands facing difficulties with introducing renewable energy.

Satsumasendai City has enacted a “Next-Generation Energy Vision” and is actively working to create a next-generation energy utilization model that will benefit its residents. With the purpose of encouraging tourism and making the lives of residents more viable through the “eco-islands” development, Satsumasendai City has promoted several demonstration projects connected with the introduction of rental EVs and super-compact EV mobility (Note 1). The joint project will create the acceptable environment on the Koshiki islands for introducing renewable energy, and will promote efforts to make all the islands zero-emission.

In addition to the reused EV battery systems, the project will also install solar power systems at two evacuation facilities on the Koshiki Islands that can be used in the case of disasters and other emergencies. Satsumasendai City will thereby boost the islands’ disaster-prevention capabilities and establish a multi-dimensional power supply infrastructure not solely dependent on petroleum-based fuel.

Sumitomo Corporation will utilize the know-how in reused EV battery systems (Note 2) that it has accumulated so far, and, in cooperation with Sumitomo Corporation Kyushu, will construct on the Koshiki Islands all the facilities needed for this project (shown in figure below). A subsidy from the Ministry of the Environment (Note 3) will be used to construct these facilities, which are expected to be completed during the first half of fiscal 2015. Reused EV batteries are to be supplied by 4R Energy Corporation (“4R”; Note 4), a joint venture company founded by Sumitomo Corporation and Nissan Motor Corporation.

Sumitomo Corporation will be seeking to create new business opportunities utilizing these economically-efficient reused EV battery systems, and to broadly extend this new electric power-related business including remote islands and micro-grids business etc., both inside and outside Japan.

(Note 1)An electric vehicle that is more compact than a normal vehicle, seating one or two persons and serving as a simple and convenient means of getting around
(Note 2)FY2013 Osaka City Yumeshima “World’s First Large-Scale Reused EV Battery System” Demonstration Project
(Note 3)FY2014 Ministry of the Environment Subsidy for CO2 Emission Reduction Project Costs (Project to Develop Low-Carbon Communities on Remote Islands)”
(Note 4)4R Energy Corporation
Nissan Motor Corporation and Sumitomo Corporation established 4R Energy Corporation in September 2010 to reuse, resell, re-abricate and recycle (the 4Rs) lithium-ion batteries used in electric vehicles (EV), and jointly examine 4R businesses that offer secondary use as a solution for energy storage in the global market.